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We provide a computationally simple method of analyzing the effects of fundamental and sunspot shocks in linear rational expectations models when the equilibrium is indeterminate. Under indeterminacy sunspots can affect model dynamics through endogenous forecast errors. Moreover, the effect of fundamental shocks on forecast errors is not uniquely determined. The solution method is illustrated with a New Keynesian dynamic stochastic equilibrium model that can be solved analytically. Under a passive interest-rate rule, the response of inflation to an unanticipated interest rate cut is ambiguous: there are some equilibria in which inflation increases and others in which prices fall.